Today the market is building on yesterday’s late day buying spree, but there is not a whole lot to get excited about when you look at this 60 minute chart of the Dow. The RSI remains in a bearish pattern, trading between 20-60, and until we get into the 70 area I’ll continue to be suspicious of the buying.

The market was/is oversold, so these sort of massive rallies are to be expected. One aspect of yesterday’s rally that I did like was the volume on the Nasdaq, which was the highest since August and could be interpreted as some sort of minor capitulation. Add in the fact that today we are seeing some follow through and I would say it’s enough to give the bulls some hope that better days are ahead. It’s also worth noting that we had a 90% upside volume day on the Nasdaq yesterday.

Watch for the indices to make New Highs after this New Low. On the DOW, that would be a break and close above 11,190, NASDAQ needs to get above 2,560 and SPX above 1,175. Now that is some kind of commitment. Stay alert guys.